Property-casualty renewal: county faces 11% pooled premium increase as national catastrophe losses climb

Hope Barker, the property casualty trust administrator for the pooled trust, told Flathead County commissioners that the trust’s recommended 2025–26 renewal will result in an overall contribution increase of roughly 11.15% for the county. She told the commission that national trends — more frequent catastrophic events and larger jury awards — are driving higher pricing across the market.

Why it matters: County leaders heard that the pool’s structure and reinsurance approach are intended to provide coverage stability during volatile market periods, but participants should expect incremental contribution increases to maintain the trust’s ability to pay large losses without passing a single-year spike onto members.

Barker said the trust buys reinsurance and has historically kept the county’s premium “just under a million dollars,” but she reported that a secondary market option would have priced similar coverage around $4.2 million. “There’s more than likely going to be a reckoning” in the market at some point, she said, and the pool uses modest annual increases to preserve reserves and pay for potential reinsurance cost jumps.

Presenters from Marsh McLennan emphasized national drivers for liability pricing: larger jury awards, growing plaintiff advertising and litigation funding, and a higher propensity to sue. The county’s three-year loss runs showed volatile recent years: a liability loss ratio spike (cited as 98% for one policy year) that will phase out of the rating over the next two years if no new high-value losses occur. Marsh reported 86 claims paid in a recent prior policy year totaling about $888,500 and, for the current fiscal year shown in the packet, 36 claims with roughly $333,000 incurred.

County staff and the trust recommended a handful of local steps to limit future premium pressure. Barker and Marsh urged a review of inventory and insured values — a county audit of vehicle and equipment values could reduce insured total values and premium. Marsh noted the county’s total insured property rose by about $16.5 million year over year (buildings +$13.8M; vehicles +$2.8M), which contributed to the calculated rate increase. Barker explained that adjusting vehicle and equipment values to current actual cash value and removing obsolete units can lower premium without changing coverage for replacement equipment.

Speakers emphasized the difference between vehicle actual cash value and replacement cost for attached equipment: some vehicle contents (radios, light bars, in-vehicle computers) are paid at replacement value when a total loss occurs. Marsh staff said they use Price Digest and VINs to set retail values for autos and encouraged department heads to return schedules promptly to keep values accurate.

Risk-management services offered to members were highlighted: litigation defense, HR assistance, land-use guidance, public-safety risk assessments and peer reviews for detention facilities. Barker identified public-safety staff (Dan O’Malley and Brandon Harris) and counsel resources for employment and land-use matters as services members can call on.

County finance staff said department heads have sometimes been reluctant to lower insured values for fear of underpayment after a total loss; Barker and Marsh described options (annual percentage depreciation, VIN-based valuation) to make values more accurate while noting a modest risk that an individual total loss might be slightly underinsured but that premium savings generally outweigh that risk.

Ending: Commissioners asked staff to prioritize a review of the county vehicle/equipment schedule before the renewal bind date. Marsh and the trust presenters offered to run VIN-based valuation reports and to work with county finance and department heads to reduce unnecessary insured value and control future premium increases.